First Solar, headquartered in Tempe, Arizona, manufactures CdTe solar modules and employs 6,700 people. The company, which went public in 2006, operates in two segments: Modules Business and Other.
Based on our analysis, First Solar, a leader in renewable energy solutions, has received an undervalued rating of 4 out of 5 stars from Cashu. This rating is supported by several key financial ratios that indicate strong performance relative to its sector.
First, the price-to-earnings (PE) ratio for First Solar stands at 12.90, significantly lower than the sector average of 23.16. A lower PE ratio suggests that the stock may be undervalued compared to its earnings potential, signaling a buying opportunity for investors.
Additionally, First Solar's price-to-book (PB) ratio is 2.37 compared to the sector's 3.48. This indicates that the stock is trading at a lower multiple of its book value, implying that investors are getting more value for each dollar spent.
The company's net profit margin of 30.72 is impressive, especially when juxtaposed against the sector’s negative margin of -15.27. This highlights First Solar's ability to convert revenue into profit effectively, showcasing operational efficiency.
Furthermore, First Solar's return on equity (ROE) of 16.20 far exceeds the sector average of -23.19. This strong ROE indicates that the company is adept at generating profit from shareholders' equity, which is a positive sign for potential investors.
Lastly, the return on assets (ROA) ratio of 10.66, compared to the sector's -12.89, demonstrates First Solar's effective use of its assets to generate earnings, enhancing its attractiveness as an investment.
This is not a comprehensive overview of our valuation and should not be viewed as financial advice. Always do your own research before considering an investment.
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